Regulators Investigating Allegations Against Cash App

Regulators Investigating Allegations Against Cash App

( – The popular money-transferring platform “Cash App” is undergoing a federal investigation after claims that its lack of due diligence makes financial transfers easier for terrorist groups and money launderers.

The investigation follows reports from whistleblowers, who have not been named, that the platform fails to perform proper due diligence with its customers. That, they claim, makes it a hotbed for the financing of illegal activities. Their concerns were submitted to the US Treasury’s Financial Crimes Enforcement Network (FinCEN), the Securities and Exchange Commission, and the Commodities Futures Trading Commission.

They also said that Cash App does not follow the requirement of banks to verify the identity of its users since it is technically not a bank. Cash App offers the ability for users to remain anonymous, which they believe has allowed it to be used for organizations that are facing sanctions from the US government. It also works with a variety of financial firms and institutions that make tracking financial transactions difficult for regulators, according to the whistleblowers.

The US Treasury’s Financial Crimes Enforcement Network (FinCEN) is referring the issue to an internal investigations team after lengthy discussions with the whistleblowers. They will also be working with other federal agencies.

Cash App allows users to instantly transfer funds amongst themselves. It also facilitates the easy purchase of stocks and cryptocurrencies. It boasts over 55 million active users worldwide. It has partnered with some of the biggest names in finance, including Wells Fargo and Visa.

According to NBC News, Edward Siedle, who became a lawyer after working with the SEC, said there are “obvious national security issues here” and noted that the government isn’t adequately maintaining pace with financial innovations.

Scams are not uncommon on Cash App. Consumer advocates have tried warning users of deceptive financial transfers and fraudulent investments, but nefarious users are frequently finding new ways to rip off others.

Cash App was founded in 2013 by Jack Dorsey, the tech billionaire who also co-founded X (previously Twitter). The app is owned by Dorsey’s parent company Block (formerly Square).

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